Greater New Orleans

Derrick Shepherd pleads not guilty

Rusty Costanza / The Times-PicayuneLa. state senator Derrick Shepherd, left, leaves the federal courthouse in New Orleans after his indictment April 10. He is accompanied by his attorney Clarence Roby.

State Sen. Derrick Shepherd pleaded not guilty Wednesday to federal charges that he helped a convicted bond broker hide illegal proceeds and created fake invoices to legitimize the money as payment for legal services.

The arraignment before U.S. Magistrate Judge Louis Moore Jr. was the Marrero Democrat's first appearance in court after a grand jury indicted him April 10 on five criminal counts. He is named in the 41-count superseding indictment that also accuses bond broker Gwendolyn Joseph Moyo; Joseph Zoucha, her alleged "straw man"; and two Nevada corporations she controlled.

Shepherd, 38, was released on a $5,000 signature bond. He didn't respond to questions when exiting the courtroom. His lawyer, Clarence Roby, took a sarcastic tone to challenge the indictment, calling it "interesting reading."

"I think the government is going to have a good time proving all of those elements," he said.

Shepherd faces three criminal counts of mail fraud, one count of conspiracy to commit mail and wire fraud, and one count of conspiracy to commit money laundering. The crimes carry a maximum sentence of 85 years in prison, but legal observers predict he could face closer to six years if convicted.

After Assistant U.S. Attorney Greg Kennedy read the possible penalties for each count, Moore asked: "Mr. Shepherd, do you understand the sentencing penalties?"

"Yes, sir," he said.

Prosecutors accuse Moyo, 53, of New Orleans, of orchestrating a scheme to launder $2 million paid to her companies for bogus construction bonds. The Louisiana Department of Insurance seized her firms' accounts and ordered Moyo to shut down her business based on 1989 and 1991 federal convictions banning her from selling insurance.

The indictment says Shepherd falsified records at his Marrero law firm to conceal $141,000 in checks written to AA Communications, one of Moyo's companies. The document lists numerous transactions showing how he shuffled the money to various accounts, used part of it to retire campaign debt and then returned about half of the sum to Moyo and her agents.

During the same hearing, Moyo pleaded not guilty to the new charges that the grand jury leveled against her since her original indictment in October, when she was ordered detained without bond. Representing herself, she started several rambling exchanges with the magistrate judge, who asked her to reconsider hiring a lawyer.

Zoucha, 66, of Oceanside, Calif., pleaded guilty during a separate hearing April 11.

Moore scheduled both defendants for trial June 2 before U.S. District Judge Carl J. Barbier.